The March jobs report was released this morning, and the loss of jobs was expectedly bad. Nonfarm payrolls shed 701,000 jobs in the month, the worst single month since March 2009 (-800,000) and the first negative figure since 2010. The headline unemployment rate jumped 90 bps to 4.4%, and it will almost certainly climb much higher in the coming months. Markets were, of course, expected a dismal showing, and in the first 20 minutes of trading following the release, Treasuries and S&P 500 futures are little changed. A Bloomberg article yesterday afternoon reported that U.S. regulators and the Treasury Department are holding off on assisting mortgage servicers struggling with the prospect of delayed borrower payments and excessive margin calls on hedges, according to sources close to the discussions. The Mortgage Bankers Association and other interested parties had been lobbying hard for government relief during these unprecedented conditions, but the article suggested that officials involved in the talks want to see how many borrowers actually seek forbearance before moving to extend credit to servicers.

Jason Haley
Chief Investment Officer